Warren Buffett: America has not lost its magic touch

Billionaire investor Warren Buffett, the founder and CEO of Berkshire Hathaway (BRK-A, BRK-B), told a group of small business owners that the argument that future generations in America aren’t going to be as well-off is “ridiculous.”

“[Any] time you hear anybody say, ‘You know, your children aren’t going to live better than you do or your children’s children and so on,’ it’s ridiculous. And the reason is exemplified by these people behind me. We have a wonderful system. This country, we haven’t lost the magic touch. The formula’s still there.”

Buffett, who turns 87 at the end of this month, made the comments at Goldman Sachs’ (GS) 10,000 Small Businesses graduation program in Baltimore, Maryland, earlier this month.

During his remarks, Buffett highlighted the tremendous wealth that America has built in a relatively short amount of time.

“This country is incredible,” he said. “I mean, if you think about it, if you put three of me end to end, not that I’m suggesting that, but if you put three of me end to end at 87, it’s 20 years before Thomas Jefferson wrote the Declaration of Independence. Three life times like mine and you’ve transformed a prairie land— basically nothing was here — into $92 trillion. That’s the most recent estimate of American wealth. From nothing. And the good news is the game has just started.”

To illustrate his point further, Buffett, who has lived in the same home he bought in Omaha in 1958, went on to describe his neighborhood as “upper middle class.” He noted that the kids attend public school and they don’t all get cars when they turn 16.

“Every person in that neighborhood is living better than John. D. Rockefeller, Sr. lived when I was born in 1930. Think of that,” he said. “In medicine, in education, entertainment, and travel, you name it, they are in a better position in life, essentially, than he was the year I was born. That’s in one person’s life time. And the game is just starting.”

“And I just applaud these people that are taking advantage of that. But that’s America, folks. People want to better themselves. We all want to help each other in doing that. Americans can do anything if they set their mind to it.”

—Julia La Roche is a finance reporter at Yahoo Finance. Follow her on Twitter.